MTNL appoints HSBC as advisor

23rd December 2004: Mahanagar Telephone Nigam has appointed HSBC as advisor for the process of synergising the PSU's operations with BSNL, as proposed by the Department of Telecom. "We have finalised on HSBC and the letter has been sent to them," MTNL CMD R S P Sinha said. The advisor will help in preparing the accounts and considering other pros and cons with regard to synergising of operations in the perspective of each individual case. MTNL wants to present its case to DoT with strong figures and updated books as it is a listed entity in India and abroad, and to ensure its shareholders get the maximum value in the process of synergising of the operations, he said. The DoT has already appointed a consortium led by ICICI Securities as advisor for synergising the operations of the two telecom PSUs. The consortium includes NM Rothschild (India), ABN Amro, AF Ferguson and lawyers Desai and Dewanji. BSNL is also in the process of appointing an advisor, which will assist the telecom giant in the process.

IOC board approves merger and share swap ratio for IBP

22nd December 2004: The board of state-run Indian Oil Corp (IOC), the country’s top refiner, has approved a merger with oil retailer IBP, the company told the Bombay Stock Exchange (BSE) today. The Board of Directors have approved a swap ratio of 125:100 i.e. 125 equity shares of IOC would be offered for every 100 equity shares of IBP for merger of the two entities. IOC currently owns around 53% in IBP. The merger has to be approved by the government.

KRCL recommend merger with Indian Rail

22nd December 2004: The Konkan Railway Corporation Limited has been asked to submit a proposal for merger with Indian Railways, as its shareholder agreement is due for revision in June, 2005. The decision on merger would be taken during the revision of shareholders agreement, said B Rajaram, KRCL Managing Director. KRCL owes Rs 2,000 crore to shareholders, which include states like Goa, Maharashtra, Karnataka and Kerala besides Rs 2,000 crore to Indian Railways, he added. The official, however, said the corporation could prove it and come out of the red if given more time. What has caught KRCL on the wrong foot is the inability even to service its debt, which was being done through loans from Indian Railways, the official said. KRCL has intellectual property worth Rs 10,000 crore, but the corporation's board was of the opinion that it should be allowed to mature, he said. KRCL is planning to submit another proposal for conversion of its debt to equity, Rajaram added.